What is the geographic scope of a Chatime Development Territory?
Chatime Franchise · 2025 FDDAnswer from 2025 FDD Document
We also offer multi-unit development agreement franchises to qualified persons who must establish certain minimum numbers of Chatime Stores within a designated geographic territory (a "Development Territory"). If we grant you a multi-unit development agreement franchise, you will execute our standard form of multi-unit development agreement attached as Exhibit C (the "Multi-Unit Development Agreement") and be granted the right to begin opening Chatime Stores in your Development Territory (the "Development Rights"). Your master franchise business includes the obligation to open a certain number of Chatime Stores in your Development Territory in accordance with a specified schedule (the "Development Quota"). Upon establishing each additional outlet under the Multi-Unit Development Agreement, you will be required to sign our then-current Franchise Agreement, which may differ from the current Franchise Agreement included with this Franchise Disclosure Document. If you fail to meet your Development Quota or fail to comply with any financial obligation relating to the Development Rights, we may terminate your Development Rights, reduce or eliminate your Development Territory or the territorial protections provided under your Multi-Unit Development Agreement, or take other action we deem appropriate in our discretion.
Source: Item 1 — The Franchisor, and Any Parents, Predecessors, and Affiliates (FDD pages 6–9)
What This Means (2025 FDD)
According to Chatime's 2025 Franchise Disclosure Document, a Development Territory is a designated geographic territory. Chatime offers multi-unit development agreement franchises to qualified individuals who commit to establishing a minimum number of Chatime stores within this defined area.
The Development Territory is significant because it grants the franchisee Development Rights, allowing them to open Chatime stores within that specific geographic area. The franchisee is obligated to open a certain number of stores, known as the Development Quota, according to a set schedule. This quota is a critical component of the agreement.
Failure to meet the Development Quota or any financial obligations related to the Development Rights can lead to serious repercussions. Chatime reserves the right to terminate the Development Rights, reduce or eliminate the Development Territory, or remove territorial protections provided in the Multi-Unit Development Agreement. This underscores the importance of carefully assessing one's ability to meet the development requirements before entering into such an agreement with Chatime.